Recently, the Legislative Affair Office of the State Council starts to solicit public opinion on the Law of the People’s Republic of China against Unfair Competition (amendment draft for examination) (hereinafter the draft for examination). The draft for examination rules that a business operator who free rides on famous brands may be imposed a fine up to 1,000,000 Yuan. It is further ruled that a business operator who free rides on famous brand with the illegal earnings of over 50,000 Yuan, may be imposed a fine of not more than 5 times of the illegal earnings; if the circumstances are serious, the business license may be revoked; if the illegal earnings is less than 50,000 Yuan, a fine of not more than 250,000 may be imposed; if the illegal earnings is incalculable, a fine of not less than 100,000 and not more than 1,000,000 may be imposed in light of the circumstances. Under the current law, the maximum fine is 3 times of the illegal earnings.
It is reported that, there are repetition and overlap in the provisions of the current Anti-unfair Competition Law, Anti-monopoly Law, Trademark Law and Advertisement Law. Moreover, the determining and punitive criteria of the competent departments are not unified. Therefore, the draft for examination further clarifies that, administrative organization for industry and commerce has the general jurisdiction over unfair competition, while relevant departments shall supervise and inspect according to laws and regulations.
